this issue will continue to fester
Global warming is a reality that is already putting the financial pinch on weather-dependent businesses. In New England, maple syrup producers are reeling from another dismal sap season. The region's ski resorts are losing tens of millions of dollars every winter there is reduced snowfall. Meanwhile, worldwide insurance claims for extreme weather events and disasters like drought and forest fires have jumped tenfold in the last 40 years, hitting $55 billion in 2002. So serious is this issue that the world's second-largest reinsurer, Swiss Re, is telling its corporate clients to come up with strategies for handling global warming or risk losing their liability coverage.
And the financial ramifications will only grow as companies in energy-intensive businesses are subjected to an expanding array of greenhouse gas controls at home and abroad. Next year, companies operating in Europe will have to pay for greenhouse emissions, and those exceeding their limits will face stiff penalties. Such limits could bring substantial harm to the US auto industry as European markets grow for cleaner technologies like hybrids, already available from Japanese automakers Honda and Toyota.
Companies have two ways to go on global warming: ignore the growing need to reduce greenhouse gas emissions and get away from fossil fuels or view it as a market signal to innovate and invest in competitive new technologies.
Those who stand to suffer -- or benefit -- the most from those decisions are the investors owning stock in these companies. And that's practically every American whose retirement is tied up in mutual funds and other investment portfolios.
Mindy Lubber/Boston Globe/Common Dreams May.05.04
